HomeMy WebLinkAboutOrd 1575 - Water and Sewer Revenue Bonds for Waterworks Utility ILA
1906
CITY OF TUKWILA
WASHINGTON
ORDINANCE NO. 1
AN ORDINANCE OF THE CITY OF TUKWILA, WASHINGTON,
RELATING TO THE WATERWORKS UTILITY OF THE CITY,
INCLUDING THE SYSTEM OF SEWERAGE AS A PART THEREOF:
AMENDING ORDINANCE NO. 1337 AS AMENDED BY ORDINANCE
NO. 1408 AND ORDINANCE NO. 1413, PROVIDING FOR THE
ISSUANCE OF $1,030,000 PRINCIPAL AMOUNT OF WATER AND
SEWER REVENUE BONDS, 1990, OF THE CITY FOR THE PURPOSE
OF PROVIDING FUNDS TO PAY THE COSTS OF COMPLETING A
PORTION OF THE SYSTEM OR PLAN OF ADDITIONS TO AND
BETTERMENTS AND EXTENSIONS OF THE WATERWORKS UTILITY
OF THE CITY ADOPTED BY ORDINANCE NO. 1337, AS HEREIN
AMENDED, AND TO PAY COSTS OF ISSUING THE BONDS; FIXING
THE DATE, FORM, MATURITIES, INTEREST RATES, TERMS AND
COVENANTS OF SUCH BONDS; PROVIDING FOR THE SALE AND
DELIVERY OF SUCH BONDS SHEARSON LEHMAN HUTTON INC.,
SEATTLE, WASHINGTON; AND REPEALING SECTON 9 OF
ORDINANCE NO. 1408 AND SECTIONS 3 AND 4 OF ORDINANCE
NO. 1413.
WHEREAS, the City of Tukwila, Washington, (then the Town
of Tukwila) by Ordinance No. 320, passed by the Town Council
and approved by the Mayor on May 1, 1961, and subsequently
amended, specified and adopted a system or plan for a system of
sewerage for the Town and provided that system of sewerage
become a part of the waterworks utility of the Town, and
authorized the issuance and sale of Water and Sewer Revenue
Bonds, 1961, in the principal amount of not to exceed $170,000
to pay portion of the cost thereof, such waterworks utility, as
hereinafter referred to, being deemed to include the systems of
water supply and distribution and sanitary sewage disposal, as
combined by Ordinance No. 320 pursuant to RCW 35.67.320, and
any additions thereto and extensions, renewals and betterments
thereof hereafter made or constructed; and
WHEREAS, $170,000 of the Water and Sewer Revenue Bonds,
1961 (the "1961 Bonds were issued pursuant to Ordinance
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No. 334 and are payable from the gross revenues of the
waterworks utility, including as a part of such revenues a
water and sanitary sewage disposal service surcharge payable
under a contract between the City and Puget Western, Inc., a
Washington corporation; and
WHEREAS, the City of Tukwila, Washington, by Ordinance
No. 381, passed by the City Council and approved by the Mayor
on June 3, 1963, adopted a system or plan for making additions
to and betterments and extensions of the waterworks utility of
the City, consisting of the construction and installation of
certain sewer collection lines, trunk sewer line and general
facilities, estimated the total cost of such plan to be
$819,000, and provided that payment therefor would be made
(a) by assessments to be levied in the amount of not to exceed
$412,000 against property specially benefited by the proposed
improvement and included in a local improvement district to be
formed, and (b) from the proceeds received from the issuance
and sale of Water and Sewer Revenue Bonds, 1963, in the amount
of not to exceed $407,000 par value; and
WHEREAS, by Ordinance No. 382, passed by the City Council
and approved by the Mayor on July 1, 1963, the system or plan
of additions to and betterments and extensions of the
waterworks utility of the City of Tukwila, as adopted by
Ordinance No. 381, was ordered to be carried out, Local
Improvement District No. 5 was established, and it was ordered
that not to exceed $412,000 of the cost and expense of carrying
out such system or plan should be paid by assessments to be
levied in the amount of not to exceed $412,000 against the
property specially benefited by such improvement and included
in Local Improvement District No. 5 and the remaining cost to
be paid from the proceeds to be received from the issuance and
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sale of Water and Sewer Revenue Bonds, 1963 (the "1963 Bonds'),
in the amount of not to exceed $407,000, provided, however,
that in the event that Val Vue Sewer District, King County,
Washington, should construct the Val Vue Trunk Sewers as
defined in Ordinance No. 381 the amount of such water and sewer
revenue bonds should be reduced by $140,000 to not exceed
$267,000; and
WHEREAS, the City thereafter contracted with Val Vue Sewer
District to construct the Val Vue Trunk Sewers, and, pursuant
to Ordinance No. 387, passed by the City Council and approved
by the Mayor on October 7, 1963, issued and sold $190,000 par
value of the not to exceed $267,000 par value of such 1963
Bonds on a parity of lien with the 1961 Bonds; and
WHEREAS, the City Council heretofore determined that the
proceeds received from the issuance and sale of the 1963 Bonds
were insufficient to complete the carrying out of the system or
plan of additions to and betterments and extensions of the
waterworks utility of the City, as adopted by Ordinance No. 381
and by Ordinance No. 422, passed by the City Council and
approved by the Mayor on January 18, 1965, issued and sold an
additional $45,000 par value of the remaining authorized but
unissued $77,000 par value of water and sewer revenue bonds
authorized by Ordinances Nos. 381 and 382, such $45,000 par
value of bonds having been combined with an additional
authorized $40,000 par value of bonds, and such combined issue
of bonds was issued under date of March 1, 1965, on a parity of
lien with the 1961 Bonds and 1963 Bonds in the total amount of
$85,000 par value and designated as Water and Sewer Revenue
Bonds, 1965 (the "1965 Bonds and
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WHEREAS, by Ordinance No. 748 passed by the City Council
and approved by the Mayor on November 20, 1972, the City issued
and sold $675,000 par value of Water and Sewer Refunding and
Construction Revenue Bonds, 1972 (the "1972 Bonds to provide
the funds to pay, redeem and retire the City's then outstanding
Water and Sewer Revenue Bonds, 1970, and to provide the funds
necessary to pay the cost of carrying out the system or plan of
additions to and betterments and extension of the waterworks
utility of the City, specified and adopted by such Ordinance
No. 748, which 1972 Bonds were issued on a parity of lien with
the 1961 Bonds, 1963 Bonds and 1965 Bonds in accordance with
the provisions of Section 7 of Ordinance No. 334; and
WHEREAS, by Ordinance No. 1337 passed by the City Council
and approved by the Mayor on December 3, 1984, the City
specified, adopted and ordered the carrying out of a system or
plan of additions to and betterments and extensions of the
waterworks utility of the City, estimated the total cost of
such plan to be $2,900,000 and provided that payment therefor
would be made from the proceeds received from the issuance and
sale of water and sewer revenue bonds in the amount not to
exceed $2,900,000 and, pending the issuance of such bonds,
provided for the issuance and sale of the City's Water and
Sewer Revenue Bond Anticipation Note, 1984, in the principal
amount of $2,900,000 (the "Outstanding Note which Note
matured on December 20, 1986; and
WHEREAS, by Ordinance No. 1408 passed by the City Council
and approved by the Mayor on November 24, 1986, the City
amended Ordinance No. 1337 by increasing the estimated total
cost of carrying out the system or plan of additions to and
betterments and extensions of the waterworks utility of the
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City to $3,600,000 and provided that payment therefore would be
made from the proceeds of the issuance and sale of water and
sewer revenue bonds in the amount not to exceed $3,600,000 and
provided for the issuance and sale of the City's $3,600,000 par
value Water and Sewer Revenue Bonds, 1986 (the "1986 Bonds
for the purpose of paying the cost of redeeming the Outstanding
Note and completing the construction of the plan of additions
to and betterments and extensions of the waterworks utilities;
which 1986 Bonds were issued on a parity of lien with the 1961
Bonds, 1963 Bonds, 1965 Bonds and 1972 Bonds in accordance with
the provisions of Section 7 of Ordinance No. 334; and
WHEREAS, by Ordinance No. 1413 passed by the City Council
and approved by the Mayor on December 15, 1986, the City
amended Sections 4, 6 and 9 of Ordinance No. 1408, and
Section 7 of Ordinance No. 334 as a condition to insuring the
1986 Bonds by Municipal Bonds Insurance Association (MBIA); and
WHEREAS, the cost of completing construction of such plan
of additions to and betterments and extension of the waterworks
utility of the City has increased to approximately $4,630,000;
and
WHEREAS the City Council deems it to be in the best
interest of the City that it issue its Water and Sewer Revenue
Bonds, 1990, to pay the cost of completing construction of the
plan of additions to and betterments and extensions of the
waterworks utility adopted by Ordinance No. 1337 and the costs
of issuance and sale of such bonds, and Shearson Lehman Hutton,
Inc., has offered to purchase such bonds on the terms and
conditions hereinafter set forth; NOW, THEREFORE,
THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, DO
ORDAIN as follows:
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Section 1. As used in this ordinance, the following words
shall have the following meanings:
(a) "Bond Fund" shall mean that special fund of the
City known as the Water and Sewer Revenue Bond Fund, 1961,
created by Ordinance No. 334 for the payment of the principal
of and interest on the 1961 Bonds and any bonds issued on a
parity therewith, including the Outstanding Parity Bonds and
the Bonds.
(b) "Bond Registrar" shall mean the fiscal agencies
of the State of Washington in Seattle, Washington, and New
York, New York, as the same may be designated from time to time.
(c) "Bonds" shall mean the $1,030,000 par value of
Water and Sewer Revenue Bonds, 1990, of the City issued
pursuant to and for the purposes provided in this ordinance.
(d) "1961 Bonds" shall mean the $170,000 par value
of Water and Sewer Revenue Bonds, 1961, issued for the purposes
provided in and pursuant to Ordinance No. 334.
(e) "1963 Bonds" shall mean the $190,000 par value
of Water and Sewer Revenue Bonds, 1963, issued for the purposes
provided in and pursuant to Ordinance No. 387.
(f) "1965 Bonds" shall mean the $85,000 par value of
Water and Sewer Revenue Bonds, 1965, issued for the purposes
provided in and pursuant to Ordinance No. 422.
(g) "1972 Bonds" shall mean the $675,000 par value
of Water and Sewer Refunding and Construction Revenue Bonds,
1972, issued for the purposes provided in and pursuant to
Ordinance No. 748.
(h) "1986 Bonds" shall mean the $3,600,000 par value
of Water and Sewer Revenue Bonds, 1986, of the City issued
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pursuant to and for the purposes provided in Ordinance
No. 1408, as amended by Ordinance No. 1413.
(i) "City" shall mean the City of Tukwila,
Washington, formerly the Town of Tukwila.
(j) "Future Parity Bonds" shall mean any and all
water and sewer revenue bonds of the City issued after the date
of the issuance of the Bonds and in accordance with Section 7
of Ordinance No. 334, as amended by Ordinances Nos. 1408 and
1413, and Section 10 herein, the payment of the principal of
and interest on which constitutes a charge and lien upon the
revenue of the Waterworks Utility equal in rank with the charge
and lien upon such revenue required to be paid into the Bond
Fund to pay and secure the payment of the principal of and
interest on the Outstanding Parity Bonds and the Bonds.
(k) "Government Obligations" shall mean United
States Treasury Certificates, Notes and Bonds (including State
and Local Government Series SLGS) and direct obligations of the
U.S. Treasury which have been stripped by the Treasury itself
(excludes CATS, TRGS and similar securities).
(1) "Outstanding Parity Bonds" shall mean the
outstanding standing 1961 Bonds, 1963 Bonds, 1965 Bonds, 1972
Bonds and 1986 Bonds.
(m) "Plan of Additions and Betterments" shall mean
the system or plan of additions to and betterments and
extensions of the Waterworks Utility specified, adopted and
ordered to be carried out by Ordinance No. 1337, as amended, of
the City.
(n) "Principal and Interest Account" shall mean the
account of that name created in the Bond Fund for the payment
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of the principal of and interest on the Outstanding Parity
Bonds, the Bonds and Future Parity Bonds.
(o) "Reserve Account" shall mean the account of that
name created in the Bond Fund for the purpose of securing the
payment of the principal of and interest on the Outstanding
Parity Bonds, the Bonds and Future Parity Bonds.
(p) "Term Bond Maturity Year or Years" shall mean
any last maturity year in which the outstanding amount of bonds
of any one issue or series which are scheduled to mature
(regardless of any reservation of parity redemption rights) is
more than two times the average annual principal maturity of
series and of all bonds issued on a
the bonds of that issue or
parity therewith for three
term bond maturity year.
(q) "Term Bonds"
Term Bond Maturity Year.
(r) "Waterworks Utility" shall mean the waterworks
utility of the City, including the system of sewerage.
Section 2. Section 4 of Ordinance No. 1337 is amended to
as follows:
Section 4. The estimated cost of the acquisition,
construction and installation of the plan of Additions and
Betterments, including the costs of financing, issuance,
sale and administration of the Bonds, is declared to be,
as near as may be, the sum of %0/000/000 $4,630,000, which
shall be paid from the proceeds of the issuance and sale
of the Bonds and form any other funds of the City legally
available to be used therefor. The Bonds are authorized
to be issued at such time as is determined by future
ordinance, and shall bear such interest, shall mature at
read
years immediately proceeding such
shall mean
any bonds maturing in a
such times and contains such other terms and covenants as
shall be determined by future ordinance.
Section 3. Findings. The City Council finds:
(1) All payments required by any ordinance of the City
pertaining to outstanding water and sewer revenue
bonds of the City have been made into the Bond Fund
for the payment of such water and sewer revenue bonds
and no deficiency exists therein; and
(2) There is or will be on file with the City prior to
the delivery of the Bonds a certificate of an
independent professional registered engineer
experienced in municipal utilities and licensed to
practice in the State of Washington showing that in
his or her professional opinion the revenues of the
waterworks utility of the City, including any water
and sanitary sewage disposal service surcharge
payable under any Agreement between the City and any
third party, for any twelve months out of the
immediately preceding fifteen months' period adjusted
to reflect a year's net income form each customer of
the waterworks utility of the City connected to such
utility at the end of the twelve month period who has
not been a customer for the entire twelve -month
period, plus the additional revenue, from whatever
source and of whatever nature, anticipated to be
received from the improvement in connection with the
issuance of the Bonds, are sufficient, after payment
of normal operation and maintenance costs and state
and federal taxes, to equal at least 1.35 times the
average annual principal and interest requirements of
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the Outstanding Parity Bonds and the Bonds, but
except the principal requirements of any term bond
maturity year or years, as defined in Section 8 of
Ordinance No. 334, as amended by Ordinance No. 1413.
(3) Provision is made in Section 9 herein for the payment
into the Reserve Account of the amounts required by
Section 7 of Ordinance No. 334.
It is declared that in creating the Bond Fund and in
fixing the amounts to be paid into the Bond Fund, as aforesaid,
the City Council and corporate authorities of the City have due
regard to the cost of operation and maintenance expenses of the
Waterworks Utility and to any proportion or part of the gross
revenue previously pledged as a fund for the payment of bonds,
warrants or other indebtedness or obligations and declare that
the City has not set aside into the Bond Fund a greater amount
or proportion of that gross revenue and proceeds than in its
judgment will be available over and above such cost of
operation and maintenance and the debt service and reserve
requirements for the presently outstanding Outstanding Parity
Bonds and other obligations of that gross revenue.
Section 4. Description of Bonds. For the purpose of
providing the money required to pay the cost of completing the
Plan of Additions and Betterments and paying the costs of
issuance and sale of the Bonds, the City shall issue the Bonds
in the principal amount of $1,030,000. The Bonds shall be
designated Water and Sewer Revenue Bonds, 1990; shall be dated
July 1, 1990; shall be in the denomination of $5,000 or any
integral multiple thereof within a single maturity; shall be
numbered separately in the manner and with any additional
designation as the Bond Registrar deems necessary for purpose
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of identification; shall bear interest at the rates set forth
below, computed on the basis of a 360 -day year of twelve 30 -day
months, payable on December 1, 1990 and semiannually thereafter
on each succeeding June 1 and December 1 to maturity or earlier
redemption of the Bonds; and shall bear interest at the rates
and mature on December 1 in years and amounts as follows:
Maturity Interest
Years Amounts Rates
1991 145,000 6.25
1992 155,000 6.40
1993 165,000 6.50
1994 175,000 6.60
1995 190,000 6.65
1996 200,000 6.70
Section 5. Registration and Transfer of Bonds. The Bonds
shall be issued only in registered form as to both principal and
interest and recorded on books or records maintained by the Bond
Registrar (the "Bond Register The Bond Register shall
contain the name and mailing address of the owner of each Bond
and the principal amount and number of each of the Bonds held by
each owner.
Bonds surrendered to the Bond Registrar may be exchanged
for Bonds in any authorized denomination of an equal aggregate
principal amount and of the same interest rate and maturity.
Bonds may be transferred only if endorsed in the manner provided
thereon and surrendered to the Bond Registrar. Any exchange or
transfer shall be without cost to the owner or transferee. The
Bond Registrar shall not be obligated to exchange or transfer
any Bond during the fifteen days preceding any principal payment
or redemption date.
Section 6. Payment of Bonds. Both principal of and
interest on the Bonds shall be payable in lawful money of the
United States of America. Interest on the Bonds shall be paid
by checks or drafts mailed on the interest payment date to the
registered owners at the addresses appearing on the Bond
Register on the fifteenth day of the month preceding the
interest payment date. Principal of the Bonds shall be payable
upon presentation and surrender of the Bonds by the registered
owners at either of the principal offices of the Bond Registrar
at the option of the owners.
Section 7. Optional Redemption; Open Market Purchase of
Bonds. Bonds maturing in the years 1991 through 1993,
inclusive, shall be issued without the right or option of the
City to redeem those Bonds prior to their stated maturity
dates. The City reserves the right and option, to redeem Bonds
maturing on or after December 1, 1994, prior to their stated
maturity dates as a whole or in part in inverse order of
maturity (and by lot within a maturity in such manner as the
Bond Registrar shall determine) on December 1, 1993, or on any
interest payment date thereafter, at a price of 101% of par plus
accrued interest to the date fixed for redemption.
Portions of the principal amount of any Bond, in
installments of $5,000 or any integral multiple thereof, may be
redeemed. If less than all of the principal amount of any Bond
is redeemed, upon surrender of that Bond at either of the
principal offices of the Bond Registrar, there shall be issued
to the registered owner, without charge therefor, a new Bond (or
Bonds at the option of the registered owner) of the same
maturity and interest rate in any of the denominations
authorized by this ordinance in the aggregate principal amount
remaining unredeemed.
The City further reserves the right and option to purchase
any or all of the Bonds in the open market at any time at a
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price not in excess of par plus accrued interest to the date of
purchase.
Section 8. Failure to Redeem Bonds. If any Bond is not
redeemed when properly presented at its maturity or call date,
the City shall be obligated to pay interest on that Bond at the
same rate provided in the Bond from and after its maturity or
call date until that Bond, both principal and interest, is paid
in full or until sufficient money for its payment in full is on
deposit in the Bond Fund hereinafter created and the Bond has
been called for payment by giving notice of that call to the
registered owner of each of those unpaid Bonds.
Section 9. Payments into Bond Fund. The Bond Fund was
created by Ordinance No. 334 and has been divided into two
accounts, the Principal and Interest Account and the Reserve
Account. So long as any Bonds are outstanding against the Bond
Fund, the City Treasurer covenants to set aside and to pay into
the Principal and Interest Account and the Reserve Account, out
of the gross revenue of the Waterworks Utility, in addition to
the amounts required to be paid and retained therein by
Ordinance No. 334 for the 1961 Bonds, Ordinance No. 387 for the
1963 Bonds, Ordinance No. 422 for the 1965 Bonds, Ordinance
No. 748 for the 1972 Bonds,
and Ordinance No. 1408, as amended
by Ordinance No. 1413, for the 1986 Bonds, certain fixed
amounts, without regard to any fixed proportion, and such other
money as provided, on or before the 20th day of each month,
namely:
(a) Into the Principal and Interest Account,
there shall be deposited the accrued interest
received by the City as partial payment for the Bonds
on their delivery, and, commencing with the month of
July, 1990, an amount equal to at least 1/5 of the
interest to become due and payable on the Bonds on
December 1, 1990 (after deducting the accrued
interest to be deposited), and, commencing with the
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month of December, 1990, an amount equal to at least
1/12 of the principal and interest to become due and
payable on the Bonds on December 1, 1991, and,
thereafter and continuing as long as any of the Bonds
are outstanding, 1/6 of the next ensuing requirements
for interest and 1/12 of the principal to become due
and payable on the next principal payment date on all
of the Bonds then outstanding.
(b) Into the Reserve Account, the City shall
make approximate equal deposits for each month for
five successive years commencing with July 1, 1990 so
that by July 1, 1995, an amount equal to the average
annual debt service of the Bonds (hereinafter
referred to as the "Reserve Requirement shall be
accumulated therein.
The Reserve Account may be accumulated from any other money of
the City available therefore in addition to the gross revenue of
the Waterworks Utility.
The City covenants and agrees that it will at all times
maintain in the Reserve Account the required reserves as set
forth, except for withdrawals as authorized in this section,
until there is a sufficient amount in the Principal and Interest
Account and the Reserve Account to pay the principal of and
interest on the Outstanding Parity Bonds, the Bonds and any
Future Parity Bonds to the final maturity thereof, at which time
no further payments need be made into the Bond Fund.
In the event there shall be a deficiency in the Principal
and Interest Account to meet maturing installments of either
principal of or interest on bonds payable from the Bond Fund,
such deficiency shall be made up from the Reserve Account by the
withdrawal of cash therefrom for that purpose. Any deficiency
created in the Reserve Account by reason of any such withdrawal
then shall be made up from the gross revenue of the Waterworks
Utility which shall be first available after required payments
into the Principal and Interest Account.
All money in the Reserve Account may be kept on deposit in
the official bank depository of the City or may be invested and
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reinvested in Permitted Investments at a fixed price and
maturing no later than one monch prior to the final maturity
date of the last outstanding bonds payable out of the Bond
Fund. In no event shall any money in the Bond Fund or any other
money reasonably executed to be used to pay principal of and /or
interest on the Bonds be invested in other than Permitted
Investments or at a yield which would cause the Bonds to be
arbitrage bonds within the meaning of Section 148 of the United
States Internal Revenue Code of 1986, as amended or replaced and
redesignated, and applicable regulations thereunder. If the
required reserve is deposited in the Reserve Account, interest
earned on any such investment or on such bank deposit in the
Reserve Account attributable to the Bonds or Future Parity Bonds
shall be deposited into the Principal and Interest Account and
used to pay the next interest or principal coming due on bonds
payable from the Bond Fund.
For the purpose of this section, Permitted Investments
shall mean legal investments permitted the City which are
(1) direct obligations of the United States of America (in the
form of obligations issued or held in book -entry form on the
books of the Department of the Treasury or obligations the
principal of an interest on which are unconditionally guaranteed
by the United States of America; (2) unless otherwise specified,
bonds, debentures, notes or other evidence of indebtedness
issued or guaranteed by any of the following federal agencies
(full faith and credit agencies): U. S. Export- Import Bank
(direct obligations or fully guaranteed certificates of
beneficial ownership), Farmers Home Administration (certificates
of beneficial ownership), Federal Financing Bank, Federal
Housing Administration (debentures), General Services
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Administration (participation certificates), Government National
Mortgage Association (GNMA- guaranteed- mortgage- backed bonds and
GNMA- guaranteed -pass- through obligations), U. S. Maritime
Administration (guaranteed Title XI financing), New Communities
Debentures (U. S. Government guaranteed debentures), and U. S.
Public
public
bonds,
issued
Housing Notes and Bonds (U. S. government guaranteed
housing notes and bonds); (3) unless otherwise specified,
debentures, notes or other evidence of
or guaranteed by any of the following U.
agencies (non -full faith and credit agencies):
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indebtedness
S. government
Federal Home
Loan Bank System (senior debt obligations), Federal Home Loan
Mortgage Association (participation certificates), Federal
National Mortgage Association (mortgage backed securities and
senior debt obligations), and Student Loan Marketing Association
(senior debt obligations); and (4) certificates of deposit,
savings accounts or deposit accounts which are fully secured by
the FDIC or FSLIC.
If the City fails to set aside and pay into the Bond Fund
the amounts above set forth, the owner of any of the outstanding
Bonds may bring action against the City to compel such setting
aside and payment.
Section 10. Pledge of Gross Revenue and Lien Position.
The gross revenue of the Waterworks Utility is pledged to the
payments required by this ordinance, and the Bonds constitute a
charge and lien upon the gross revenue of the Waterworks Utility
prior and superior to all other charges of any kind or nature,
excluding charges for operation and maintenance, except that the
charge and lien on the gross revenue of the Waterworks Utility
for the Bonds shall be on a parity with the charge and lien
thereon for the Outstanding Parity Bonds and any Future Parity
Bonds.
Section 11. Form and Execution of Bonds. The Bonds shall
be printed, typed or multicopied, or lithographed on good bond
paper in a form consistent with the provisions of this
ordinance. The Bonds shall be executed on behalf of the City by
the facsimile or manual signatures of the Mayor and City Clerk,
and the seal of the City or a facsimile reproduction thereof
shall be printed or impressed thereon.
Only Bonds bearing a Certificate of Authentication in the
following form, manually executed by the Bond Registrar, shall
be valid or obligatory for any purpose or entitled to the
benefits of this ordinance. The authorized signing of a
Certificate of Authentication shall be conclusive evidence that
the Bonds so authenticated have been duly executed,
authenticated and delivered hereunder and are entitled to the
benefits of this ordinance.
CERTIFICATE OF AUTHENTICATION
This bond is one of the fully registered City of
Tukwila, Washington, Water and Sewer Revenue Bonds,
1990, described in the Bond Ordinance.
WASHINGTON STATE FISCAL AGENCY
Bond Registrar
By
Authorized Officer
If any officer whose facsimile signature appears on the
Bonds ceases to be an officer of the City authorized to sign
bonds before the Bonds bearing his or her facsimile signature
are authenticated or delivered by the Bond Registrar or issued
by the City, those Bonds nevertheless may be authenticated,
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delivered and issued and, when authenticated, issued and
delivered, shall be as binding on the City as though that person
had continued to be an officer of the City authorized to sign
bonds. Any Bond also may be signed on behalf of the City by any
person who, on the actual date of signing of the Bond, is an
officer of the City authorized to sign bonds, although he or she
did not hold the required office on the date of issuance of the
Bonds.
Section 12. Bond Registrar. The Bond Registrar shall
keep, or cause to be kept, at its principal corporate trust
office, sufficient books for the registration and transfer of
the Bonds which shall be open to inspection by the City at all
times. The Bond Registrar is authorized, on behalf of the City,
to authenticate and deliver Bonds transferred or exchanged in
accordance with the provisions of the Bonds and this ordinance,
to serve as the City's paying agent for the Bonds and to carry
out all of the Bond Registrar's powers and duties under this
ordinance and Ordinance No. 1338 of the City establishing a
system of registration for the City's bonds and obligations.
The Bond Registrar shall be responsible for its
representations contained in the Bond Registrar's Certificate of
Authentication on the Bonds. The Bond Registrar may become the
owner of Bonds with the same rights it would have if it were not
the Bond Registrar and, to the extent permitted by law, may act
as depository for and permit any of its officers or directors to
act as members of, or in any other capacity with respect to, any
committee formed to protect the rights of Bond owners.
Section 13. Bond Negotiable Instruments. The Bonds shall
be negotiable instruments to the extent provided by RCW
62A.8 -102 and 62A.8 -105.
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Section 14. Covenants. The City covenants and agrees with
the owner of each of the Bonds at any time outstanding, as
follows:
(a) It will establish, maintain and collect
such rates and charges for water and for sanitary
sewage disposal service so long as Outstanding Parity
Bonds, Bonds or Future Parity Bonds are outstanding,
as will make available, together with interest
accruing from investment of money in the Reserve
Account and any water and sanitary sewage disposal
service surcharge payable under any agreement between
the City and any third party, for the payment of the
principal of and interest on such bonds as the same
shall become due an amount equal to at least 1.35
times the average annual debt service, both principal
and interest, of such bonds, after deducting the
costs of operation and maintenance of the Waterworks
Utility, but before depreciation.
(b) It will at all times maintain and keep the
Waterworks Utility in good repair, working order and
condition, and will at all times operate such
Waterworks Utility and the business in connection
therewith in an efficient manner and at a reasonable
cost.
(c) It will not sell, lease, mortgage or in any
manner encumber or dispose of all the property of the
Waterworks Utility unless provision is made for
payment into the Bond Fund of a sum sufficient to pay
the principal of and interest on all bonds payable
out of the Bond Fund at any time outstanding, and it
will not sell, lease, mortgage or in any manner
encumber or dispose of any part of the property of
the Waterworks Utility that is used, useful and
material to the operation thereof, unless provision
is made for the replacement thereof, or for payment
into the Bond Fund of the total amount of gross
revenues received which shall not be less than an
amount which shall bear the same ratio to the amount
of outstanding bonds payable out of the Bond Fund as
the revenue of the Waterworks Utility available for
debt service for such outstanding bonds for the
twelve months preceding such sale, lease, encumbrance
or disposal from the portion of the Waterworks
Utility sold, leased, encumbered or disposed of bears
to the revenues available for debt service for such
bonds from the entire Waterworks Utility for the same
period. Any such money so paid into the Bond Fund
shall be used to retire such outstanding bonds at the
earliest possible date.
(d) While any of the Bonds remain outstanding,
it will keep proper and separate accounts and records
in which complete and separate entries shall be made
of all transactions relating to the Waterworks
-19-
Utility, and it will furnish the original purchaser
of the bonds or any subsequent owner or owners of the
Bonds, at the written request of such owner or
owners, complete operating and income statements of
such waterworks utility in reasonable detail covering
any calendar year not more than 90 days after the
close of such calendar year, and it will grant any
owner or owners of at least 25% of the outstanding
Bonds the right at all reasonable times to inspect
the entire waterworks utility and all records,
accounts and data of the City relating thereto. Upon
request of any owner of any such Bonds, it also will
furnish to such owner a copy of the most recently
completed audit of the City's accounts by the State
Auditor of Washington or such other audit as is
authorized by law in lieu thereof.
(e) It will not furnish water or sanitary
sewage disposal service to any customer whatsoever
free of charge and will promptly take legal action to
enforce collection of all delinquent accounts.
(f) It will carry the types of insurance on the
properties of the Waterworks Utility in the amounts
normally carried by private water and sewer companies
engaged in the operation of waterworks utilities, and
the cost of such insurance shall be considered a part
of operating and maintaining such utility. If, as
and when the United States of America or some agency
thereof shall provide for war risk insurance, the
City further agrees to take out and maintain such
insurance on all or such portions of such utility on
which such war risk insurance may be written in an
amount or amounts to cover adequately the value
thereof.
(g) It will pay all costs of operation and
maintenance of the Waterworks Utility and the debt
service requirements for the Outstanding Parity Bonds
and otherwise meet the obligations of the City as
herein set forth.
(h) It will take all actions necessary to
prevent the interest on the Bonds from being included
in gross income for federal income tax purposes, and
it will neither take any actions nor make or permit
any use of proceeds of the Bonds or other funds of
the Waterworks Utility at any time during the term of
the Bonds which will cause the interest on the Bonds
to be included in gross income for federal income tax
purposes.
The City further covenants that it has not been notified of
any listing or proposed listing by the Internal Revenue Service
to the effect that it is a bond issuer whose arbitrage
certifications may not be relied upon.
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Section 15. Small Governmental Issues Arbitrage Rebate
Exemption and Designation of Bonds as "Qualified Tax Exempt
Obligations. The City finds and declares that (a) it is a duly
organized and existing governmental unit of the State of
Washington and has general taxing power; (b) no Bond which is
part of this issue of Bonds is a "private activity bond" within
the meaning of Section 141 of the Internal Revenue Code of 1986,
as amended (the "Code (c) at least 95 percent of the net
proceeds of the Bonds will be used for local governmental
activities of the City (or of a governmental unit the
jurisdiction of which is entirely within the jurisdiction of the
City); (d) the aggregate face amount of all tax exempt
obligations (other than private activity bonds) issued by the
City and all entities subordinate to the City (including any
entity which the City controls or which derives its authority to
issue tax exempt obligations from the City or which issues
tax exempt obligations on behalf of the City) during the current
calendar year is not reasonably expected to exceed $5,000,000;
and (e) the amount of tax exempt obligations, including the
Bonds, designated as "qualified tax- exempt obligations" for the
purposes of Section 265(b)(3) of the Code or any predecessor
provision of federal law by the City during the calendar year in
which the Bonds are issued does not exceed $10,000,000. The
City therefore certifies that the Bonds are eligible for the
arbitrage rebate exemption under Section 148(f)(4)(C) of the
Code and designates the Bonds as "qualified tax exempt
obligations" for the purposes of Section 265(b)(3) of the 1986
Code.
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Section 16. Parity Provisions Amended and Restated.
Section 7 of Ordinance No. 334, as amended, is amended and
restated as follows:
Section 7. The ToypiCity reserves the right to issue
additional or refunding water and sewer revenue bonds which
shall constitute a charge or lien upon the gross revenues
of the Waterworks Utility/Of/Jaffe/7'03.0i, including all
additions thereto and betterments, replacements and
extensions thereof at any time made, on a parity of lien
with the Bonds, if the following conditions shall be met
and complied with at the time of issuance of such
additional or refunding water and sewer revenue bonds:
(a) All payments then required by this
Ordinance or any other ordinance hereafter enacted
pertaining to Outstanding Parity Bonds, the Bonds
and to any such additional or refunding water and
sewer revenue bonds hereafter issued shall have
been made into the Bond Fund and maintained intact
therein; and
(b) The revenues of the Waterworks Utility
Of/t140/T955471, including any water and sanitary
sewage disposal service surcharge payable under
any Agreement between the TO4 (City and any third
party, for any twelve months out of the
immediately preceding fifteen months' period
adjusted to reflect a year's net income from each
customer of the Waterworks Utility $t /Y1i1 ZOs4vi
connected to such utility at the end of that
twelve -month period who has not been a customer
for the entire twelve -month period, plus the
additional revenue, from whatever source and of
whatever nature, anticipated to be received from
the proposed improvement in connection with which
such additional water and sewer revenue bonds are
to be issued, shall be deemed sufficient, after
the payment of normal operation and maintenance
costs and taxes, to equal at least 1.35 times the
average annual principal and interest requirements
of all then outstanding water and sewer revenue
bonds, including the Bonds and of the additional
or refunding bonds proposed to be so issued, but
except the principal requirements of any term bond
maturity year or years, as defined in Section 8 of
this Ordinance, of any bonds payable out of the
Bond Fund. Such determination of the sufficiency
of the revenues shall be made and certified to by
an independent professional registered engineer
-22-
experienced in municipal utilities and licensed to
practice in the State of Washington; except, that
if such additional bonds proposed to be so issued
are for the sole purpose of refunding water and
sewer revenue bonds, such certification of
coverage shall not be required if the amount
required for payment of the principal and interest
in each year for the refunding bonds is not
increased over the amount required for the bonds
to be refunded thereby and the maturities of said
refunding bonds are not extended beyond the
maturities of the bonds to be refunded thereby; and
(c) The ordinance authorizing the issuance
of such additional bonds shall provide that an
amount equal to the average annual debt service of
the additional bonds proposed to be issued shall
be accumulated as a reserve in the Bond Fund, said
amounts to be accumulated by monthly deposits
commencing not later than one month after the date
of issuance of the additional bonds and to be
accumulated within five years after the date of
issuance of such bonds, and said reserve to be
maintained in such amounts so long as any of those
additional bonds are outstanding to the last
maturity thereof. In the case of parity refunding
bonds the ordinance authorizing the issuance of
such refunding bonds shall provide that the money
in the "Reserve Account" for the bonds to be
refunded shall be transferred to the "Reserve
Account" in the Bond Fund, or that the moneys in
the "Reserve Account" for the bonds to be refunded
shall be used to redeem such bonds, in which event
an amount equal to the average annual debt service
for the refunding bonds proposed to be issued
shall be accumulated as a reserve in the same
manner and within the same times as set forth
herein for additional revenue bonds.
In lieu of the accumulation of a reserve in
the manner provided in this subsection 7(c), the
ordinance authorizing such additional bonds may
provide for a cash deposit by a third party with
an escrow agent acceptable to the 795s4 City in an
amount equal to the average annual debt service of
the additional bonds proposed to be issued, which
deposit shall be made on or before the delivery of
the additional bonds and shall be conditioned on
the payment into the "Reserve Account" of the Bond
Fund of amounts necessary to make up any
deficiency in the Principal and Interest Account
in the Bond Fund to meet maturing installments of
either principal or interest on such additional
bonds. That third party shall also be bound by
agreement with the TO071City to make such
additional cash deposits in escrow as are
necessary to maintain that deposit at the required
level in the event that the original or subsequent
deposits are called upon to make up the
deficiencies in the Principal and Interest Account
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of the Bond Fund. Such cash deposits shall remain
in escrow at the required level until the moneys
in the Reserve Account paid in for those
additional bonds equal the average annual debt
service of those additional bonds.
Upon the redemption or defeasance of all of the
1961 Bonds, 1963 Bonds, 1965 Bonds and 1972 Bonds, the
City may issue future Parity Bonds if the following
conditions shall be met and complied with at the time
of issuance of such Future Parity Bonds:
(a) All payments then required by this
Ordinance or any other ordinance hereafter enacted
Pertaining to Outstanding Parity Bonds, the Bonds
and to any such additional or refunding water and
sewer revenue bonds hereafter issued shall have
been made into the Bond Fund and maintained intact
therein; and
(b) The historical gross revenues of the
Waterworks Utility, including any water and
sanitary sewage disposal service surcharge
payable under any Agreement between the City and
any third party, for any twelve consecutive months
out of the immediately preceding fifteen months'
period adiusted to reflect (1) a year's net income
from each customer of the Waterworks Utility
connected to such utility at the end of the at
twelve -month period who has not been a customer
for the entire twelve -month period, (2) the
additional revenue, from whatever source and of
whatever nature, anticipated to be received from
the improvement in connection with which
additional water and sewer revenue bonds are to be
issued, (3) revenue to be derived from any
customer under any executed contract for water
and /or sewer service which revenue was not
included in the historical gross revenues of the
Waterworks Utility, and (4) the engineer's
estimate of the gross revenues to be derived by
the City from customers within improved property
available to commit to any additions to and
improvements an extensions of the Waterworks
Utility to be paid out of the proceeds of the sale
of the Future Parity Bonds (as defined in
Ordinance No. 1408) or other additions to and
improvements and betterments of the Waterworks
Utility then under construction and not fully
connected to the Waterworks Utility when such
additions, improvements and betterments are
completed and connected, shall be deemed
sufficient, after the payment of normal operation
and maintenance costs (adiusted to reflect actual
or reasonably anticipated changed in those
operation and maintenance costs subsequent to that
twelve -month period) and state and federal taxes,
to equal at least 1.35 times the average annual
principal and interest requirements of all then
outstanding water and sewer revenue bonds,
-24-
including the Bonds and of the additional or
refunding bonds proposed to be so issued, but
except the principal requirements of any term bond
maturity year or years, as defined in Section 8 of
this Ordinance No. 334 of any bonds payable out of
the Bond Fund, such termination of the sufficiency
of the revenues shall be made and certified to by
an independent professional registered engineer
experienced in municipal utilities and licensed to
practice in the State of Washington; except, that
if such additional bonds proposed to be so issued
are for the sole purpose of refunding water and
sewer revenue bonds, such certification of
coverage shall not be required if the amount
required for payment of the principal and interest
in each year for the refunding bonds is not
increased over the amount required for the bonds
to be refunded thereby and the maturities of said
refunding bonds are not extended beyond the
maturities of the bonds to be refunded thereby; and
(c) The ordinance authorizing the issuance
of such additional bonds shall provide that such
additional bonds shall provide that an amount
equal to the average annual debt service of the
additional bonds proposed to be issued shall be
accumulated as a reserve in the Bond Fund, those
amounts to be accumulated by monthly deposits
commencing not later than one month after the date
of issuance of the additional bonds and to be
accumulated within five years after the date of
issuance of such bonds, and that reserve to be
maintained in such amounts so long as any of those
additional bonds are outstanding to the last
maturity thereof. In the case of parity refunding
bonds the ordinance authorizing the issuance of
such refunding bonds shall provide that the money
in the Reserve Account for the bonds to be
refunded shall be transferred to the 'Reserve
Account' in the Bond Fund, or that the money in
the 'Reserve Account' for the bonds to be refunded
shall be used to redeem such bonds, in which event
an amount equal to the average annual debt service
for the refunding bonds proposed to be issued
shall be accumulated as a reserve in the same
manner and within the same times as set forth
herein for additional revenue bonds.
(d) The ordinance authorizing the issuance
of such Future Parity Bonds shall provide for the
creation of a sinking fund account in the Bond
Fund for any Term Bonds to be issued and for
regular payments to be made into such account for
the payment of principal of such Term Bonds on or
before their maturity, or, as an alternative, for
the mandatory redemption of such Term Bonds prior
to their maturity date from money on deposit in
the Principal and Interest Account.
-25-
Section 17. Refunding or Defeasance of Bonds. In the
event the City shall issue advance refunding bonds pursuant to
the laws of the State of Washington, or have money available
from any other lawful source, to pay the principal of and
interest on the Bonds or such portion thereof included in the
refunding or defeasance plan as the same become due and payable
and to refund or defease all such then outstanding Bonds and to
pay the costs of refunding or defeasance, and shall have
irrevocably set aside for and pledged to such payment, refunding
or defeasance, money and /or direct obligations of the United
States of America sufficient in amount, together with known
earned income from the investments thereof, to make such
payments and to accomplish the refunding as scheduled
(hereinafter called the "trust account and shall irrevocably
make provisions for redemption of such Bonds, then in that case
the Bonds shall be deemed defeased (hereinafter collectively
called the "defeased Bonds Thereafter, all right and
interest of the owners of the defeased Bonds in the covenants of
this Ordinance, in the gross revenue of the Waterworks Utility
and in funds and accounts obligated to the payment of such Bonds
shall cease and become void, except such owners shall have the
right to receive payment of the principal of and interest on the
defeased Bonds from the trust account and, in the event the
funds in the trust account are not available for such payment,
shall have the residual right to receive payment of the
principal of and interest on the defeased Bonds from the gross
revenue of the Waterworks Utility without any priority of lien
or charge against those revenues or covenants with respect
thereto except to be paid therefrom.
-26-
After the establishing and full funding of such trust
account, the City then may apply any money in any other fund or
account established for the payment or redemption of the
defeased Bonds to any lawful purposes as it shall determine,
subject only to the rights of the owners of any other bonds then
outstanding.
In the event that the refunding plan provides that the
Bonds being refunded or the refunding bonds to be issued be
secured by cash and /or direct obligations of the United States
of America or other legal investments pending the prior
redemption of those Bonds being refunded and if such refunding
plan also provides that certain cash and /or direct obligations
of the United States of America or other legal investments are
pledged irrevocably for the prior redemption of those Bonds
included in the refunding plan, then only the debt service on
the Bonds which are not defeased Bonds and the refunding bonds,
the payment of which is not so secured by the refunding plan,
shall be included in the computation of coverage for determining
compliance with the rate covenants.
Section 18. Ordinance a Contract. The covenants of the
City contained in this ordinance constitute a contract between
the City and the owners of the Bonds. In the event of default
of any covenant by the City, any such bondowner may enforce
performance and obtain other appropriate relief in the proper
form as permitted by law.
Section 19. Deposit of Bond Proceeds. There has been
created in the office of the City Treasurer a special
Water /Sewer Construction Fund No. 403 into which fund shall be
deposited the principal proceeds of the Bonds and out of which
shall be paid all remaining costs of carrying out the Plan of
-27--
Additions and Betterments for which the Bonds are issued and the
costs of issuing the Bonds. The City may use any money
remaining in the Construction Fund after the payment of all such
costs to carry out any capital improvements or other repairs to
the Waterworks Utility authorized by law. The accrued interest
received shall be deposited in the Bond Fund.
Section 20. Approval of Bond Purchase Contract and
Delivery of Bonds. Shearson Lehman Hutton, Inc., Seattle,
Washington, has submitted an offer to purchase the Bonds, dated
July 9, 1990, the City to furnish at its expense the Bonds and
the approving legal opinion of Foster Pepper Shefelman,
municipal bond counsel of Seattle, Washington. Bond counsel
shall not be required to review or express any opinion
concerning the completeness or accuracy of any official
statement, offering circular or other sales material relating to
the issuance of the Bonds or otherwise used in connection with
the Bonds, and bond counsel's opinion shall so state. The City
Council, deeming that no better price could be received for the
Bonds and that it is in the best interest of the City, accepts
the offer.
The Mayor and City Clerk are authorized and requested, upon
the execution and delivery of the Bonds to the City, to deliver
the Bonds to the purchaser upon payment therefor in accordance
with such accepted offer.
Section 21. Repealer. Section 9 of Ordinance No. 1408,
Section 3 of Ordinance No. 1413, and Section 4 of Ordinance
No. 1413 are repealed.
Section 22. Official Statement. The City Council has been
provided with copies of a preliminary official statement dated
July 3, 1990 (the "Preliminary Official Statement prepared in
-28-
connection with the sale of the Bonds. For the sole purpose
of the purchaser's compliance with Securities and Exchange
Commission Rule 15c2- 12(b)(1), the City "deems final" that
Preliminary Official Statement as of its date, except for the
omission of information as to offering prices, interest
rates, selling compensation, principal amount per maturity,
delivery date, ratings and other terms of the Bonds dependent
on such matters.
Section 23. Effective Date. This Ordinance shall be in
full force and effect five days after its passage and legal
publication as provided by law.
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA,
WASHINGTON, at a SpeczMl open public meeting thereof this 9th
day of July, 1990.
APPRO :D AS TO, FORM:
By
gfr
KJP -248*
PUBLISHED: VALLEY DAILY NEWS SUNDAY, JULY 15, 1990
ATTEST:
FILED WITH THE CITY CLERK: 7- q/d
PASSED BY THE CITY COUNCIL: 9
PUBLISHED: 7
EFFECTIVE DATE: 7 -Z 0-
ORDINANCE NO: 5 75'
610AN HERNANDEZ, Mayor Pro Tem r
218_4&,e_ 7i
JJE CANTU, City Clerk
I, JANE CANTU, City Clerk of the City of Tukwila,
Washington, certify that the attached copy of Ordinance No. /57.Y"
is a true and correct copy of the original ordinance passed on
the 9th day of July, 1990, as that ordinance appears on the
Minute Book of the City.
DATED this 9th day of July, 1990.
KJP -248*
CANTU, City Clerk